CIS-based billet exporters have increased offer prices further, supported by limited allocation and the overall positive mood in the market which prevailed until the middle of this week. A few bookings have been reported at higher levels. Nevertheless, many buyers have been staying away from purchases, seeing some worsening of the outlook in the scrap market in Turkey by the end of this week.
Most offers from large CIS-based mills have been reported at $420/mt FOB and above. A contract from a Russian supplier was reported at $418/mt FOB to Africa last week. Also, around 20,000 mt of Ukranian billet has been traded to Tunisia at a price level slightly below $440/mt CFR, which is equivalent to $415/mt FOB. Most sources believe that the tradable value is at around $415/mt FOB, if the key markets are in question. The still limited availability of billet in the CIS billet export market has made suppliers’ position stronger.
As SteelOrbis reported earlier, Algerian Qatari Steel (AQS) is looking to buy 20,000 mt of billet for rebar production and 20,000 mt for wire rod production, after the company finalized a tender for the same volume last week.
Demand from other countries from North Africa, Egypt in particular, has remained “dead”, according to sources.
Some negotiations for ex-CIS billet have been reported at Latin America, as buyers have been making enquiries since the beginning of September. The deal price level has been reported at above $415/mt FOB, but taking into account extras for the grade and freight to this destination, the base price level is hardly exceeding $415/mt FOB.
It is still possible to find offers for billet from smaller mills in the CIS at $410/mt FOB, but “it is not a matter of the price now,” a few trading sources said. The mood in the Turkish scrap market has worsened recently and billet buyers are waiting for further developments in this segment first before restocking with billet. Offers for ex-CIS billet have been at $425-435/mt CFR, while activity has slowed down.
CIS-based exporters are likely to insist on higher price levels in the coming week even if scrap prices in Turkey retreat slightly, citing limited allocation.
The SteelOrbis reference price for ex-CIS billet has been increased to $415-418/mt FOB, with $416.5/mt FOB as a mid-point, up by $1.5/mt from yesterday.